Working Paper presents research work by both Danmarks Nationalbank’s employees and our partners. The series is primarily targeted at professionals and people with an interest in central banking research as well as economics and finance in a broader sense.

Inflation and price development

Working Paper: Labor cost pass-through to producer prices in Denmark

We estimate the pass-through of a wage shock to producer prices of firms in Denmark. Our results suggest that the pass-through elasticity of wage increases to prices amounts to about one third. Our results are in line with studies of earlier time periods and confirm an important causal relationship between wages and prices.